Current approaches have focused on deriving ESCs differentiation into chondrocytes from a cell source of spontaneously formed intact mesoderm in EB formation, resulting in limited yield. Our study aimed at upregulating chondrogenic differentiation of murine ESCs by enhancing mesoderm formation. Specifically, culture of mESCs with conditioned medium from a human hepatocarcinoma cell line resulted in a cell population with a gene expression pattern similar to that of primitive streak/nascent mesoderm, including up-regulation of brachyury, goosecoid, nodal, and cripto. From this cell population, reducing the embryoid body formation time resulted in enhancement of chondrogenic differentiation, as evidenced by larger Alcian blue-stained cartilage nodules, higher production of sulfated glycosaminoglycan matrix, the presence of well-organised type II collagen and type II collagen, aggrecan and sox-9 gene expression. In conclusion, we present here a new approach to the generation of chondrocytes from mESCs that enhances yields and, thus, could have widespread applications in cartilage tissue engineering.